Utah Bankruptcy Laws

Utah has one bankruptcy district court, Utah Bankruptcy Court with two locations in Ogden and Salt Lake City. This court serves the entire state of Utah.

• Homestead, which may be a mobile home and the surrounding land not exceeding one acre, to $20,000
• Proceeds from sale of homestead to $20,000 for one year after receipt
• Washer, dryer, refrigerator, freezer, stove, microwave oven, sewing machine, carpets, family provisions for 12 months, clothing, beds and bedding
• Family portraits and art created by family
• Burial plot
• Health aids
• Disability, illness or unemployment benefits
• Medical, surgical or hospital care benefits
• Veterans benefits
• Child support
• Personal injury or wrongful death proceeds
• Qualified retirement plan
• Alimony or separate maintenance necessary for support
• Death benefit plan
• Stock bonus, pension, profit-sharing, annuity or similar plan providing benefits other than by reason of illness or disability
• Unmatured life insurance to $5,000
• Sofas, chairs and related furnishings to $500
• Dining and kitchen tables and chairs to $500
• Animals, books and musical instruments to $500
• Heirlooms or other items of particular sentimental value to $500
• Tools of trade, implements or professional library to $3,500
• Work vehicle to $2,500
• Proceeds from the sale or destruction of exempt property
• 75% of wages

Do not withdraw or take out a loan against a 401K, IRA or other similar retirement account to pay off or consolidate debt.
Under Utah law, an individual's interest as a participant or beneficiary to a retirement plan such as a 401(k), IRA or other similar tax-deferred retirement plan is exempt from creditors in bankruptcy. Therefore, a consumer may file bankruptcy, eliminate or consolidate debt, and retain all funds in their 401(k), IRA or other similar retirement plans (except deposits made one year before filing). Early withdrawal results in tax liabilities and penalties which are not dischargeable in bankruptcy.

Do not borrow money against a home to pay off excessive debt or consolidate debt.
Under the Homestead laws in the State of Utah, the present exemption for an individual's primary residence is $20,000.00 per individual and $40,000.00 per couple. Therefore, consumers should seriously consider resolving their financial difficulties through bankruptcy debt consolidation (Chapter 13) or bankruptcy debt elimination (Chapter 7). They could claim the equity in their home as exempt and emerge from bankruptcy with the equity in their home intact.

Source: Utah Bankruptcy Professionals, Attorneys at Law (Utah Bankruptcy Attorneys)

NOTE: These are the major bankruptcy exemptions. Check with your bankruptcy lawyer for a full exemptions list.

New Bankruptcy Law Changes - Outlines major changes you should know about in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), also known as the new bankruptcy laws.

This is important! The new bankruptcy law requires all debtors to fulfill two education requirements: a credit counseling course prior to filing and a financial management course before obtaining a discharge. Failure to complete either of these courses and file the appropriate certificates with the court will prevent a successful bankruptcy. The Chapter 13 Trustee will offer the required courses to Chapter 13 debtors, but Chapter 7 debtors are required to take the courses on their own.

Find a U.S. Trustee Approved Pre-Bankruptcy Counseling Provider and Post-Filing Debtor Education Provider.